Stocks moved mostly higher on Wednesday as Wall Street looked recover from a tech-led sell-off as investors awaited earnings from Nvidia (NVDA) that will set the tone for the next leg of the AI trade.
The Nasdaq Composite (^IXIC) climbed 0.5%, while the S&P 500 (^GSPC) put on nearly 0.2%, both paring larger earlier gains. The Dow Jones Industrial Average (^DJI), which includes fewer tech names, fell 0.2%. The moves came on the heels of a run of sharp losses for stocks. Bitcoin (BTC-USD) resumed a sell-off, last seen back below the $90,000 level, near its lowest levels since April.
Investors are bracing for Nvidia’s third-quarter earnings due after Wednesday’s close, which are expected to swing the stock up to 7% in either direction. More broadly, the chipmaking giant’s results could prove a make-or-break moment for this year’s strong S&P 500 rally, which has been spurred by optimism for AI-fueled growth.
Concerns about Big Tech’s massive spending on the AI buildout have fed into multiday declines, as high-profile investors offload holdings. Unease is growing that the likes of Amazon (AMZN) are stepping up their borrowing to fund AI ambitions just as the Federal Reserve looks set to put the brakes on interest rate cuts.
Given that, Fed minutes set for release later will be put under the microscope for insight into the economy and future policy. While that meeting delivered a rate cut despite division at the Fed, traders are now evenly split on whether the central bank will ease again in December.
That view could shift on Thursday, when the market gets the September jobs report — the first major data release since the government shutdown delayed economic updates.
LIVE 15 updates
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Nasdaq whips higher as Big Tech sees gains
The Nasdaq Composite (^IXIC) shot up 1.4% in mid-morning trading as investors piled back into riskier bets ahead of AI chip giant Nvidia’s (NVDA) highly anticipated earnings report.
The gain comes after two days of losses for the index, during which tech stocks sold off amid investor fears that the AI bubble could soon burst.
Big Tech stocks were mixed, with several names in the group posting significant gains. Alphabet (GOOG) and Broadcom (AVGO) led gains for the group, with both stocks up more than 5%. Nvidia climbed over 3%, while Tesla (TSLA) added almost 2%.
Microsoft (MSFT) and Amazon (AMZN) — which were downgraded to Neutral from Buy by investment firm Rothschild & Co Redburn’s analyst Alex Haissl on Tuesday — saw their shares fall modestly.
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Premarket trending tickers: Lowe’s, DoorDash, and MP Materials
Lowe’s (LOW) stock rose 4% before the bell after beating Wall Street estimates on quarterly sales. The retailer did, however, lower its full-year profit forecast amid growing economic uncertainty.
DoorDash (DASH) stock rose 3% before the bell following the news that Kroger will expand its partnerships with the online food ordering company.
MP Materials’ (MP) stock was up 4% in premarket trading on Thursday. The rare-earth company has seen some volatility over recent weeks due to export restrictions on rare earths from China. As part of the one-year trade truce, Beijing agreed to remove these restrictions; however, news has emerged that the details of that agreement have yet to be finalized between the US and China.
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